The chairman of the Brexit Party is threatening an SNP MEP with legal action after he called them a "money laundering front".

Alyn Smith made the comments in an interview with Sky News following his re-election to the European Parliament earlier this week.

Branding the Brexit party "shysters" he said: "The only question about the Brexit Party now is which laws they have broken and where their campaign finances have come from, and we'll find that out after the campaign.

"But they're a shell company that's a money laundering front and I have absolutely no doubt they'll be shown to be every bit as feckless as their predecessors in UKIP were."

Lawyers representing Brexit Party chairman Richard Tice have now written to Mr Smith demanding he issues a statement retracting his comments by noon on Thursday.

They say the Brexit Party "categorically denies" the comments and accuse Mr Smith of "debasing politics" by making them.

The letter, which party leader Nigel Farage published on Twitter, states: "Mr Tice is deeply affronted by the accusations you have made against him and the Brexit Party. Clearly your political viewpoint is different from his, but that can be no excuse for making such a very serious and totally unfounded charge of criminality against our client.

"We are sure that, on reflection, you would not wish a false allegation of criminality to remain on the record. If nothing else, it debases politics. The levelling of such an unfounded allegation reflects badly on your reputation and that of your party."

A spokesman for Mr Smith said the MEP had replied to the lawyers, citing the Goldsmith v Bhoyrul case of 1998, in which a political party was prevented from suing for defamation.

Mr Smith added: "Like many others, I would like to see a full, open, and transparent independent inquiry into the funding of Nigel Farage and the Brexit Party."